January 11, 2012

Pre 1947 Shares- Joint Listings in Pakistan India Wanted

When British India got divided in 1947 in to India and Pakistan many shareholders became citizens of one country and were holding shares of a Company which came under the other country.

After 1965 , share holdings of such unlucky shareholders were transferred to both countries Government Departments named , very perniciously " CUSTODIAN OF ENEMY PROPERTIES ".

Well , circumstances have changed. No body gains by remaining in an ENEMY Mode . Only some Promoters , by most ingenious processes , have given themselves extra gains ( at the expense on genuine holders who are , now , in Pakistan or Bangla Desh )

Of the Pre1947 Joint Stock Companies let there be Common Listings in both India and Pakistan

For a case study please consider the moves under taken by a Pre 1947 Indian Company Binani Metals Limited :-

The recent consolidation ( Reverse split ) by Binani Metals Limited to the unprecedented Rs. 1000 Face Value per share is one of the most interesting and intriguing Indian corporate actions vis-a-vis small shareholders. No other Listed company in India has a face value of Rs.1000.

Binani Metals Limited ( along with its many amalgamating companies like Metal Distributors Limited ) is more than 70 years old company .So it had many dormant ( dead share holders and Custodian of Enemy Property ) shareholders.

All those share holders holding below 10 or in not multiple of 10 were reduced to holders of fractional shares when Binani Metals Limited decided to consolidate the face value ( from Rs. 100 to Rs. 1000 ) .These share holders were compulsorily paid pro rata @ Rs. 450 for Rs. 100 face value " fraction " ( This was a mere fraction of the True Value and the Share was and still is Illiquid . No Trading in the only Regional Exchange Calcutta Stock Exchange - since 1992 ) .

The interesting topic for further research and study is what became of the dormant and Custodian of Enemy Property share accounts. There shares were compulsorily sold . But what became of such unclaimed Payment Warrants.